One chart shows white-collar biz is thriving even as jobs dry up
Employment in white-collar sectors has dipped, while output is surging.
Maskot/Getty Images Employment has dropped in white-collar sectors, while output has continued to surge.
AI and economic uncertainty are two likely reasons for the sluggish white-collar job market.
Still, how productive AI makes companies remains a question.
The white-collar sector is doing more with less.
While the number of total jobs has slid in industries like finance, tech, and professional services, output has been on a tear.
Gad Levanon, the chief economist at the Burning Glass Institute, examined how employment in white-collar-heavy sectors compares with real gross domestic product .
He wrote in a Substack article that employment in finance, insurance, information, and professional and business services is collectively down roughly 2% since the end of 2022, while real output for these sectors has soared by 16%.
The ongoing slow decline in employment for this group goes against historical patterns and highlights how workers and job seekers are facing a largely frozen, low-hire, low-fire job market .
"A growing share of the work businesses used to get done by consultants, contractors, call centers and their own back-office staff is now delivered by software, cloud and IT firms, which produce far more per worker and add almost no staff," Levanon told Business Insider.
"That is why the sector's output keeps rising while its hiring has stopped." The divergence also risks breaking the traditional link between economic growth and rising fortunes for everyday Americans.
"Even a strong, continual growth in GDP may not translate into jobs for people, may not translate into a higher quality of life for people as well," said Cory Stahle, an economist at the Indeed Hiring Lab.
People looking in these kinds of sectors may be having a challenging time.
"It's important to remember for these job seekers that a career is not necessarily built over the course of two or three years," Stahle said.
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